{"id":155710,"date":"2021-12-23T20:13:41","date_gmt":"2021-12-23T14:43:41","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=155710"},"modified":"2021-12-23T20:13:41","modified_gmt":"2021-12-23T14:43:41","slug":"our-semiconductor-shortage-is-likely-to-persist-for-a-long-while","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/our-semiconductor-shortage-is-likely-to-persist-for-a-long-while\/","title":{"rendered":"Our semiconductor shortage is likely to persist for a long while"},"content":{"rendered":"\n

News<\/strong>: The semiconductor chip shortage, currently impacting the automobile industry, is likely to last longer.<\/p>\n

How the semiconductor industry evolved in the mid-80s?<\/h5>\n

The semiconductor industry underwent a major change in the mid-80s as chips started getting commoditized.<\/p>\n

–<\/strong> To protect against price risks and secure heavy investments that go into fabs, chipmakers started asked for purchase commitments at pre-agreed prices.<\/strong><\/p>\n

–<\/strong> And to cover for demand variability, excess capacity was maintained<\/strong>.<\/p>\n

This means that now, around 80% of all production goes to pre-committed buyers, while the remainder is set for the traders.<\/p>\n

Auto industry buys semiconductors from this remainder pool of low cost supplies.<\/p>\n\n\n\n
Must Read<\/strong>: Chipped & vulnerable: GoI must make public investments to encourage private manufacturing in strategic semiconductor industry<\/span><\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
What is the way forward?<\/h5>\n

Short term<\/strong> <\/span><\/p>\n

In the near-term, the industry can revert to older systems, reducing features in vehicles, and delaying deliveries of vehicles.<\/p>\n

Long term<\/strong><\/span><\/p>\n

A longer-term response has also started to emerge.<\/p>\n

–<\/strong> Samsung has announced a new chip plant<\/strong> in Texas. Also, both Ford and GM have said they would get into long-term design and manufacturing arrangements.<\/p>\n

–<\/strong> Further, national governments have also started treating chip supplies as a strategic imperative<\/strong>. For instance<\/strong>: India’s newly announced $10 billion incentive scheme for high-end chip-making can go a long way in establishing a strong electronics manufacturing base in India.<\/p>\n\n\n\n
Must Read<\/strong>: Semiconductor manufacturing in India – Explained, pointwise<\/span><\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Source<\/strong>: This post is based on the article \u201cOur semiconductor shortage is likely to persist for a long while<\/strong>\u201d published in Livemint<\/strong> on 22nd<\/sup> Dec 2021<\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"

News: The semiconductor chip shortage, currently impacting the automobile industry, is likely to last longer. How the semiconductor industry evolved in the mid-80s? The semiconductor industry underwent a major change in the mid-80s as chips started getting commoditized. – To protect against price risks and secure heavy investments that go into fabs, chipmakers started asked… Continue reading Our semiconductor shortage is likely to persist for a long while<\/span><\/a><\/p>\n","protected":false},"author":10328,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[216,10501],"class_list":["post-155710","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-3","tag-live-mint","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704913824},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/155710","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10328"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=155710"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/155710\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=155710"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=155710"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=155710"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}